Greece deflation worsens as vital general election nears

Chris Papadopoullos was City A.M.'s economics reporter until February 2016.

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Chris Papadopoullos

The economic future of Greece is highly uncertain (Source: Getty)

Inflation has delved deeper into negative figures in Greece, figures released yesterday show.

Greek inflation was minus 2.6 per cent as measured by the year-on-year change in the consumer price index, according to data from the Hellenic Statistical Authority.

The figure marks a steep drop from November’s figure of minus 1.2 per cent. Greece has now been in a state of deflation for 22 consecutive months. The most severe deflation registered in Greece since the financial crisis was a 2.9 per cent year-on-year drop in prices in November 2013.

Portuguese annual inflation also fell. It dropped to minus 0.3 per cent in December from minus 0.1 per cent in November.

Inflation in the Eurozone as a whole came in below zero in December at 0.2 per cent.

The economic future of Greece is highly uncertain due to general elections being held on 25 January. Currently, the anti-austerity party Syriza is leading the polls which is casting doubt on Greece’s future ability to negotiate with European officials regarding further bailouts.